This includes allowing up to 17 trucks full of coal to leave the mine every hour.

Wollongong Coal had been seeking approval to expand mining in the Russell Vale mine since 2009, however the plans underwent revision several times, up to the final version in July last year.

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The plans included a change from longwall mining to bord and pillar, which Wollongong Coal CEO Warwick Lidbury told the Independent Planning Commission in October was an "environmentally friendly mining process".

On Tuesday, the IPC granted approval for Wollongong Coal to extract 3.7 million tonnes of coal over five years from the Russell Vale site.

In its Statement of Reasons for Decision, the IPC said the bord and pillar method "is unlikely to cause significant surface subsidence".

However, the IPC did acknowledge it would come with some downsides for residents near the mine.

"The project would result in some amenity impacts and additional environmental disturbance associated with recommencement of mining operations at the site in accordance with the proposed mine plan," the IPC noted in its Statement of Reasons for Decision.

"[However] the commission is of the view that the additional environmental and amenity impacts can be appropriately managed and mitigated in accordance with the applicable guidelines and policies."

The conditions include the requirement that mining causes no more than a "negligible" impact on watercourses and the Cataract reservoir.

"The applicant will be required to ensure negligible leakage and negligible reduction in the water quality of Cataract reservoir," the IPC said.

The miner will also be limited to removing a maximum of 1.2 million tonnes per year.

Transportation of coal from the site can only take place between the hours of 7am and 6pm, Monday to Friday, and 8am to 6pm on Saturday.

No transportation is permitted on Sundays or public holidays.

Wollongong Coal must also pay $67,600 a year to Wollongong City Council for five years, for the maintenance of Bellambi Lane - the road linking the mine to Memorial Drive.

Lock the Gate Alliance's Nic Clyde hit out at the IPC claiming its decision to approve the mine will damage its credibility in the eyes of the public.

Mr Clyde said the IPC could not take into consideration that the company still hasn't met its obligations for its previous approvals at Russell Vale and may well be trading while insolvent.

"Lock the Gate Alliance believes the inability of the IPC to consider a company's history and whether it is 'fit and proper' to gain a development approval is contrary to the public's interest," Mr Clyde said.

"The IPC has not been able to consider Wollongong Coal's checkered history in the Illawarra, nor the financially woeful status of the company."

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